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January 2016

Vol. 21, No. 5 Week of January 31, 2016

Continued delay in Unocal TAPS exit

A legal dispute continues to delay Unocal Pipeline Co.’s sale of its ownership interest in the trans-Alaska oil pipeline. The company said in 2012 that it was going to sell its stake in the pipeline to one or all of the other pipeline owners. But, although the Regulatory Commission of Alaska responded by authorizing a temporary suspension of the company’s pipeline transportation services, pending completion of the sale, by October of 2012 it became clear that legal issues surrounding the sale were delaying sale completion.

Since then Unocal has submitted reports at three-month intervals to the commission, indicating that the pipeline owners have a dispute over matters relating to the ownership transfer and that the companies are engaged in arbitration and litigation. The exact nature of the dispute is unclear.

The commission has responded by issuing orders extending the deadline for the transfer of operating authority for Unocal’s share of the pipeline - the commission issued the most recent of these orders on Jan. 26, in response to a filing from Unocal dated Jan. 21. In its filing Unocal told the commission that because of the continuing dispute, the company is still not in a position to file an application to transfer its operating authority. And litigation relating to the dispute “is likely to continue for a significant period of time,” the filing says.

- ALAN BAILEY






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